Shipyards warned

The government yesterday warned the General Workers' Union it would "probably" have no choice but to declare Malta Shipyards Ltd bankrupt in a few weeks' time after a union directive paralysed work at the shipyards yesterday, leaving disgruntled ship owners seeking compensation.

Government Investments Minister Austin Gatt made it clear he would not cave in to industrial pressure. On the contrary, he warned that such action would "precipitate the inevitable bankruptcy of the shipyards".

The GWU's metal and construction section yesterday issued a work to rule directive at the shipyards and urged workers not to cooperate with or help any sub-contracted individuals.

Workers were also told not to allow working parties to carry out any jobs that could be executed by shipyard employees.

The GWU demanded that the government pay its arrears to workers on the "unplanned night shift" according to the pre-determined rates.

The unrest at the shipyards started last Saturday when workers decided to cut off the electricity supply being used by workers sub-contracted by a ship owner.

The ship owner in question protested vociferously and said he intended to take legal action against the shipyards. Other representatives of Malta shipyards' clients also protested formally about the action.

The ministry yesterday said such an "irresponsible" decision by the union was illegal because the collective agreement stipulated that a ship owner may engage any workers he deems fit.

The industrial action affected a container ship belonging to an owner who was in discussions with the 'yard's management on the possibility of work on three other vessels.

The ministry said the action would affect the work rhythm on a Norwegian specialised bulk carrier.

"Malta's reputation is already suffering in this important Norwegian market because of delays in previous work caused by industrial actions. Today's industrial action could have irreparable damage on the market," the ministry said.

In an immediate response, the government and the management decided to halt the shipyards' marketing at once, arguing that the shipyards cannot provide a guarantee that work will be completed on time.

Such a decision, the minister admitted, would mean work at the 'yards in the coming months would dry up... with "obvious consequences".

Since the action had already affected contracted work and because of the expected penalties, the company will not have the necessary cash flow to pay its salaries and its financial dues, Dr Gatt said.

The ministry said it was baffled by the union's action since Dr Gatt and the GWU's deputy general secretary Manuel Micallef had agreed to thrash out a bone of contention later in the week when the minister returns from overseas.

In a letter to GWU general secretary Tony Zarb, Dr Gatt did not mince his words: The government could not contemplate further subsidising the shipyards, even if it so wished.

Dr Gatt said he could not understand why the union was threatening action because no agreement had been reached on a single clause. Scores of others had been sorted out.

"Some people think everyone will be scared and cave in to pressure because of the threats. I can assure you this tactic doesn't work with me or the government," he wrote.

When contacted, section secretary Charles Agius said he had no comment to make for the time being. "You'll hear from us later in the week," he said.

The shipyards employ about 1,700 people and are currently being subsidised to the tune of Lm8 million a year.